WRL Series Life Account
Annual Report
December 31, 1997
Western Reserve Life Assurance
Co. of Ohio
February 1998
ACC00003 (2/98)
<PAGE>
WRL SERIES LIFE ACCOUNT
----------------------------------
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors of Western Reserve Life Assurance Co. of Ohio
and Policy Owners of the WRL Series Life Account
In our opinion, the accompanying statements of assets, liabilities and
equity accounts and the related statements of operations and of changes in
equity accounts and the selected per unit data and ratios present fairly, in
all material respects, the financial position of each of the Sub-Accounts
constituting the WRL Series Life Account (a separate account of Western
Reserve Life Assurance Co. of Ohio, hereafter referred to as the "Life
Account") at December 31, 1997, the results of each of their operations, the
changes in each of their equity accounts and the selected per unit data and
ratios for each of the periods indicated, in conformity with generally
accepted accounting principles. These financial statements and selected per
unit data and ratios (hereafter referred to as "financial statements") are
the responsibility of the Life Account's management; our responsibility is
to express an opinion on these financial statements based on our audits. We
conducted our audits of these financial statements in accordance with
generally accepted auditing standards which require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining,
on a test basis, evidence supporting the amounts and disclosures in the
financial statements, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for the opinion expressed above.
/s/ PRICE WATERHOUSE LLP
- ------------------------
PRICE WATERHOUSE LLP
Kansas City, Missouri
January 30, 1998
1 9 9 7 A n n u a l R e p o r t
1
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
WRL SERIES LIFE ACCOUNT
Report of Independent Accountants ............................ 1
Statements of Assets and Liabilities and Equity Accounts ..... 3
Statements of Operations ..................................... 5
Statements of Changes in Equity Accounts ..................... 7
Selected Per Unit Data and Ratios ............................ 10
Notes to Financial Statements ................................ 15
</TABLE>
2
W R L S e r i e s L i f e A c c o u n t
<PAGE>
WRL SERIES LIFE ACCOUNT
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
At December 31, 1997
All amounts (except unit value, units and shares) in thousands
----------------------------------
<TABLE>
<CAPTION>
MONEY MARKET BOND GROWTH
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT
<S> <C> <C> <C>
ASSETS:
Investments
Investment in WRL Series Fund, Inc.:
Shares ................................ 16,381,111 1,581,226 12,215,272
=========== ========= ==========
Cost .................................. $ 16,381 $ 17,287 $ 359,253
================= =============== =================
Investments at net asset value ......... $ 16,381 $ 17,618 $ 450,062
Accrued transfers from depositor ....... 59 39 209
----------------- --------------- -----------------
Total assets .......................... 16,440 17,657 450,271
----------------- --------------- -----------------
LIABILITIES: ............................. 0 0 0
----------------- --------------- -----------------
Net assets ............................ $ 16,440 $ 17,657 $ 450,271
================= =============== =================
EQUITY ACCOUNTS:
Policy Owners' equity:
Units ................................. 1,019,515.089795 835,870.193630 7,972,011.504966
================= =============== =================
Unit value ............................ $ 16.125159 $ 21.123535 $ 56.481417
================= =============== =================
Policy Owners' equity ................. $ 16,440 $ 17,657 $ 450,271
----------------- --------------- -----------------
Depositor's equity:
Units ................................. N/A N/A N/A
================= =============== =================
Unit value ............................ $ N/A $ N/A $ N/A
================= =============== =================
Depositor's equity .................... $ N/A $ N/A $ N/A
----------------- --------------- -----------------
Total equity .......................... $ 16,440 $ 17,657 $ 450,271
================= =============== =================
</TABLE>
<TABLE>
<CAPTION>
GLOBAL
SUB-ACCOUNT
<S> <C>
ASSETS:
Investments
Investment in WRL Series Fund, Inc.:
Shares ................................ 7,604,927
==========
Cost .................................. $ 135,839
=================
Investments at net asset value ......... $ 144,823
Accrued transfers from depositor ....... 194
-----------------
Total assets .......................... 145,017
-----------------
LIABILITIES: ............................. 0
-----------------
Net assets ............................ $ 145,017
=================
EQUITY ACCOUNTS:
Policy Owners' equity:
Units ................................. 8,144,902.999720
=================
Unit value ............................ $ 17.804656
=================
Policy Owners' equity ................. $ 145,017
-----------------
Depositor's equity:
Units ................................. N/A
=================
Unit value ............................ $ N/A
=================
Depositor's equity .................... $ N/A
-----------------
Total equity .......................... $ 145,017
=================
<CAPTION>
STRATEGIC
TOTAL RETURN EMERGING GROWTH AGGRESSIVE GROWTH
SUB-ACCOUNT (A) SUB-ACCOUNT SUB-ACCOUNT
<S> <C> <C> <C>
ASSETS:
Investments
Investment in WRL Series Fund, Inc.:
Shares ................................ 5,163,177 8,082,693 5,890,842
========== ========== ==========
Cost .................................. $ 66,903 $ 133,448 $ 85,485
================= ================= =================
Investments at net asset value ......... $ 80,673 $ 164,625 $ 94,517
Accrued transfers from depositor ....... 80 77 135
----------------- ----------------- -----------------
Total assets .......................... 80,753 164,702 94,652
----------------- ----------------- -----------------
LIABILITIES: ............................. 0 0 0
----------------- ----------------- -----------------
Net assets ............................ $ 80,753 $ 164,702 $ 94,652
================= ================= =================
EQUITY ACCOUNTS:
Policy Owners' equity:
Units ................................. 4,270,324.925754 7,013,376.822852 5,230,271.098013
================= ================= =================
Unit value ............................ $ 18.910375 $ 23.484030 $ 18.096966
================= ================= =================
Policy Owners' equity ................. $ 80,753 $ 164,702 $ 94,652
----------------- ----------------- -----------------
Depositor's equity:
Units ................................. N/A N/A N/A
================= ================= =================
Unit value ............................ $ N/A $ N/A $ N/A
================= ================= =================
Depositor's equity .................... $ N/A $ N/A $ N/A
----------------- ----------------- -----------------
Total equity .......................... $ 80,753 $ 164,702 $ 94,652
================= ================= =================
</TABLE>
The notes to the financial statements are an integral part of this report.
1 9 9 7 A n n u a l R e p o r t
3
<PAGE>
WRL SERIES LIFE ACCOUNT
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
At December 31, 1997
All amounts (except unit value, units and shares) in thousands
----------------------------------
<TABLE>
<CAPTION>
GROWTH & TACTICAL ASSET
BALANCED INCOME ALLOCATION
SUB-ACCOUNT SUB-ACCOUNT (B) SUB-ACCOUNT
<S> <C> <C> <C>
ASSETS:
Investments
Investment in WRL Series Fund, Inc.:
Shares .................................. 891,005 718,410 2,124,794
======== ======== ==========
Cost .................................... $ 10,023 $ 8,540 $ 26,436
=============== =============== =================
Investments at net asset value ........... $ 10,700 $ 9,022 $ 28,925
Accrued transfers from depositor ......... 16 41 198
--------------- --------------- -----------------
Total assets ............................ 10,716 9,063 29,123
--------------- --------------- -----------------
LIABILITIES: ............................... 0 0 0
--------------- --------------- -----------------
Net assets .............................. $ 10,716 $ 9,063 $ 29,123
=============== =============== =================
EQUITY ACCOUNTS:
Policy Owners' equity:
Units ................................... 756,353.665747 563,129.649597 1,867,261.033017
=============== =============== =================
Unit value .............................. $ 14.168361 $ 16.093919 $ 15.596453
=============== =============== =================
Policy Owners' equity ................... $ 10,716 $ 9,063 $ 29,123
--------------- --------------- -----------------
Depositor's equity:
Units ................................... N/A N/A N/A
=============== =============== =================
Unit value .............................. $ N/A $ N/A $ N/A
=============== =============== =================
Depositor's equity ...................... $ N/A $ N/A $ N/A
--------------- --------------- -----------------
Total equity ............................ $ 10,716 $ 9,063 $ 29,123
=============== =============== =================
</TABLE>
<TABLE>
<CAPTION>
INTERNATIONAL
C.A.S.E. GROWTH VALUE EQUITY EQUITY U.S. EQUITY
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (C) SUB-ACCOUNT (C)
<S> <C> <C> <C> <C>
ASSETS:
Investments
Investment in WRL Series Fund, Inc.:
Shares .................................. 851,094 1,916,676 213,262 265,402
======== ========= ======= =======
Cost .................................... $ 12,159 $ 23,473 $ 2,386 $ 3,232
=============== ================= =============== ===============
Investments at net asset value ........... $ 11,924 $ 26,651 $ 2,283 $ 3,247
Accrued transfers from depositor ......... 22 63 6 11
--------------- ----------------- --------------- ---------------
Total assets ............................. 11,946 26,714 2,289 3,258
--------------- ----------------- --------------- ---------------
LIABILITIES: ............................... 0 0 0 0
--------------- ----------------- --------------- ---------------
Net assets .............................. $ 11,946 $ 26,714 $ 2,289 $ 3,258
=============== ================= =============== ===============
EQUITY ACCOUNTS:
Policy Owners' equity:
Units ................................... 969,379.081066 1,915,887.724063 214,889.042226 258,812.833059
=============== ================= =============== ===============
Unit value .............................. $ 12.322854 $ 13.943236 $ 10.654082 $ 12.588589
=============== ================= =============== ===============
Policy Owners' equity ................... $ 11,946 $ 26,714 $ 2,289 $ 3,258
--------------- ----------------- --------------- ---------------
Depositor's equity:
Units ................................... N/A N/A N/A N/A
=============== ================= =============== ===============
Unit value .............................. $ N/A $ N/A $ N/A $ N/A
=============== ================= =============== ===============
Depositor's equity ...................... $ N/A $ N/A $ N/A $ N/A
--------------- ----------------- --------------- ---------------
Total equity ............................ $ 11,946 $ 26,714 $ 2,289 $ 3,258
=============== ================= =============== ===============
</TABLE>
(a) Prior to May 1, 1997, this sub-account was known as Equity-Income.
(b) Prior to May 1, 1997, this sub-account was known as Utility.
(c) The inception date of this sub-account was January 2, 1997.
The notes to the financial statements are an integral part of this report.
4
W R L S e r i e s L i f e A c c o u n t
<PAGE>
WRL SERIES LIFE ACCOUNT
STATEMENT OF OPERATIONS
For the year ended December 31, 1997
All amounts in thousands
----------------------------------
<TABLE>
<CAPTION>
MONEY MARKET BOND GROWTH
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT
<S> <C> <C> <C>
INVESTMENT INCOME:
Dividend income ............................................................. $ 772 $ 778 $ 3,046
Capital gain distributions .................................................. 0 0 44,809
------ ------- --------
772 778 47,855
EXPENSES:
Mortality and expense risk .................................................. 133 117 3,649
------ ------- --------
Net investment income (loss) ............................................... 639 661 44,206
------ ------- --------
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) from securities transactions ...................... 0 (191) 5,459
Change in unrealized appreciation (depreciation) ........................... 0 609 9,779
------ ------- --------
Net gain (loss) on investments ............................................ 0 418 15,238
------ ------- --------
Net increase (decrease) in equity accounts resulting from operations ..... $ 639 $ 1,079 $ 59,444
====== ======= ========
</TABLE>
<TABLE>
<CAPTION>
GLOBAL
SUB-ACCOUNT
<S> <C>
INVESTMENT INCOME:
Dividend income ........................................................ $ 8,033
Capital gain distributions ............................................. 8,885
--------
16,918
EXPENSES:
Mortality and expense risk ............................................. 1,059
--------
Net investment income (loss) .......................................... 15,859
--------
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) from securities transactions ................. 910
Change in unrealized appreciation (depreciation) ...................... (105)
--------
Net gain (loss) on investments ....................................... 805
--------
Net increase (decrease) in equity accounts resulting from operations $ 16,664
========
<CAPTION>
STRATEGIC EMERGING AGGRESSIVE
TOTAL RETURN GROWTH GROWTH
SUB-ACCOUNT (A) SUB-ACCOUNT SUB-ACCOUNT
<S> <C> <C> <C>
INVESTMENT INCOME:
Dividend income ........................................................ $ 1,894 $ 0 $ 2,430
Capital gain distributions ............................................. 4,821 15,057 6,045
-------- -------- --------
6,715 15,057 8,475
EXPENSES:
Mortality and expense risk ............................................. 614 1,216 680
-------- -------- --------
Net investment income (loss) .......................................... 6,101 13,841 7,795
-------- -------- --------
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) from securities transactions ................. 484 2,278 1,053
Change in unrealized appreciation (depreciation) ...................... 6,037 8,654 5,471
-------- -------- --------
Net gain (loss) on investments ....................................... 6,521 10,932 6,524
-------- -------- --------
Net increase (decrease) in equity accounts resulting from operations $ 12,622 $ 24,773 $ 14,319
======== ======== ========
</TABLE>
The notes to the financial statements are an integral part of this report.
1 9 9 7 A n n u a l R e p o r t
5
<PAGE>
WRL SERIES LIFE ACCOUNT
STATEMENT OF OPERATIONS
For the year or period ended December 31, 1997
All amounts in thousands
----------------------------------
<TABLE>
<CAPTION>
GROWTH & TACTICAL ASSET
BALANCED INCOME ALLOCATION
SUB-ACCOUNT SUB-ACCOUNT (B) SUB-ACCOUNT
<S> <C> <C> <C>
INVESTMENT INCOME:
Dividend income ........................................................ $ 548 $ 670 $ 1,051
Capital gain distributions ............................................. 521 603 1,072
------- ------- -------
1,069 1,273 2,123
EXPENSES:
Mortality and expense risk ............................................. 77 59 210
------- ------- -------
Net investment income (loss) .......................................... 992 1,214 1,913
------- ------- -------
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) from securities transactions ................. 114 137 339
Change in unrealized appreciation (depreciation) ...................... 112 146 1,023
------- ------- -------
Net gain (loss) on investments ....................................... 226 283 1,362
------- ------- -------
Net increase (decrease) in equity accounts resulting from operations $ 1,218 $ 1,497 $ 3,275
======= ======= =======
</TABLE>
<TABLE>
<CAPTION>
C.A.S.E. GROWTH VALUE EQUITY
SUB-ACCOUNT SUB-ACCOUNT
<S> <C> <C>
INVESTMENT INCOME:
Dividend income ........................................................ $ 979 $ 292
Capital gain distributions ............................................. 85 46
------ -------
1,064 338
EXPENSES:
Mortality and expense risk ............................................. 70 155
------ -------
Net investment income (loss) .......................................... 994 183
------ -------
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) from securities transactions ................. 205 393
Change in unrealized appreciation (depreciation) ...................... (457) 2,645
------ -------
Net gain (loss) on investments ....................................... (252) 3,038
------ -------
Net increase (decrease) in equity accounts resulting from operations $ 742 $ 3,221
====== =======
<CAPTION>
INTERNATIONAL U.S.
EQUITY EQUITY
SUB-ACCOUNT (C) SUB-ACCOUNT (C)
<S> <C> <C>
INVESTMENT INCOME:
Dividend income ........................................................ $ 10 $ 108
Capital gain distributions ............................................. 0 11
------ -----
10 119
EXPENSES:
Mortality and expense risk ............................................. 14 12
------ -----
Net investment income (loss) .......................................... (4) 107
--------- -----
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) from securities transactions ................. 134 81
Change in unrealized appreciation (depreciation) ...................... (103) 15
-------- -----
Net gain (loss) on investments ....................................... 31 96
-------- -----
Net increase (decrease) in equity accounts resulting from operations $ 27 $ 203
======== =====
</TABLE>
(a) Prior to May 1, 1997, this sub-account was known as Equity-Income.
(b) Prior to May 1, 1997, this sub-account was known as Utility.
(c) The inception date of this sub-account was January 2, 1997.
The notes to the financial statements are an integral part of this report.
6
W R L S e r i e s L i f e A c c o u n t
<PAGE>
WRL SERIES LIFE ACCOUNT
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
For the year ended
All amounts in thousands
----------------------------------
<TABLE>
<CAPTION>
MONEY MARKET BOND
SUB-ACCOUNT SUB-ACCOUNT
DECEMBER 31 DECEMBER 31
----------------------- ------------------------
1997 1996 1997 1996
----------- ----------- ----------- ------------
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income (loss) ............................. $ 639 $ 491 $ 661 $ 553
Net gain (loss) on investments ........................... 0 0 418 (614)
-------- -------- -------- --------
Net increase (decrease) in equity accounts resulting
from operations ......................................... 639 491 1,079 (61)
-------- -------- -------- --------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed) ...................... 7,719 5,217 7,506 3,452
-------- -------- -------- --------
Less cost of units redeemed:
Administrative charges .................................. 3,108 2,639 1,633 1,314
Policy loans ............................................ 687 286 428 191
Surrender benefits ...................................... 854 776 437 339
Death benefits .......................................... 9 26 15 28
-------- -------- -------- --------
4,658 3,727 2,513 1,872
-------- -------- -------- --------
Increase (decrease) in equity accounts from capital
unit transactions ...................................... 3,061 1,490 4,993 1,580
-------- -------- -------- --------
Net increase (decrease) in equity accounts .............. 3,700 1,981 6,072 1,519
Depositor's equity contribution (net redemption) ......... 0 0 0 0
EQUITY ACCOUNTS:
Beginning of period ...................................... 12,740 10,759 11,585 10,066
-------- -------- -------- --------
End of period ............................................ $ 16,440 $ 12,740 $ 17,657 $ 11,585
======== ======== ======== ========
<CAPTION>
GROWTH
SUB-ACCOUNT
DECEMBER 31
-------------------------
1997 1996
------------ ------------
<S> <C> <C>
OPERATIONS:
Net investment income (loss) ............................. $ 44,206 $ 19,310
Net gain (loss) on investments ........................... 15,238 26,919
--------- ---------
Net increase (decrease) in equity accounts resulting
from operations ......................................... 59,444 46,229
--------- ---------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed) ...................... 106,236 91,556
--------- ---------
Less cost of units redeemed:
Administrative charges .................................. 37,231 29,331
Policy loans ............................................ 11,212 8,443
Surrender benefits ...................................... 15,746 12,386
Death benefits .......................................... 711 601
--------- ---------
64,900 50,761
--------- ---------
Increase (decrease) in equity accounts from capital
unit transactions ...................................... 41,336 40,795
--------- ---------
Net increase (decrease) in equity accounts .............. 100,780 87,024
Depositor's equity contribution (net redemption) ......... 0 0
EQUITY ACCOUNTS:
Beginning of period ...................................... 349,491 262,467
--------- ---------
End of period ............................................ $ 450,271 $ 349,491
========= =========
</TABLE>
<TABLE>
<CAPTION>
STRATEGIC
GLOBAL TOTAL RETURN
SUB-ACCOUNT SUB-ACCOUNT (A)
DECEMBER 31 DECEMBER 31
-------------------------- -----------------------
1997 1996 1997 1996
----------- ------------ ---------- ----------
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income (loss) ............................. $ 15,859 $ 6,524 $ 6,101 $ 2,646
Net gain (loss) on investments ........................... 805 6,374 6,521 3,636
--------- -------- -------- --------
Net increase (decrease) in equity accounts resulting
from operations ......................................... 16,664 12,898 12,622 6,282
--------- -------- -------- --------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed) ...................... 64,272 43,697 22,072 16,832
--------- -------- -------- --------
Less cost of units redeemed:
Administrative charges .................................. 12,590 6,463 6,025 4,528
Policy loans ............................................ 2,948 1,466 1,624 921
Surrender benefits ...................................... 3,391 2,226 2,044 1,301
Death benefits .......................................... 149 62 148 112
--------- -------- -------- --------
19,078 10,217 9,841 6,862
--------- -------- -------- --------
Increase (decrease) in equity accounts from capital
unit transactions ...................................... 45,194 33,480 12,231 9,970
--------- -------- -------- --------
Net increase (decrease) in equity accounts .............. 61,858 46,378 24,853 16,252
Depositor's equity contribution (net redemption) ......... 0 (268) 0 0
EQUITY ACCOUNTS:
Beginning of period ...................................... 83,159 37,049 55,900 39,648
--------- -------- -------- --------
End of period ............................................ $ 145,017 $ 83,159 $ 80,753 $ 55,900
========= ======== ======== ========
</TABLE>
The notes to the financial statements are an integral part of this report.
1 9 9 7 A n n u a l R e p o r t
7
<PAGE>
WRL SERIES LIFE ACCOUNT
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
For the year ended
All amounts in thousands
----------------------------------
<TABLE>
<CAPTION>
EMERGING GROWTH
SUB-ACCOUNT
DECEMBER 31
------------------------
1997 1996
----------- ------------
<S> <C> <C>
OPERATIONS:
Net investment income (loss) ............................. $ 13,841 $ 3,935
Net gain (loss) on investments ........................... 10,932 9,284
--------- ---------
Net increase (decrease) in equity accounts resulting
from operations ......................................... 24,773 13,219
--------- ---------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed) ...................... 54,392 40,944
--------- ---------
Less cost of units redeemed:
Administrative charges .................................. 14,518 9,201
Policy loans ............................................ 3,692 2,096
Surrender benefits ...................................... 3,986 2,754
Death benefits .......................................... 192 92
--------- ---------
22,388 14,143
--------- ---------
Increase (decrease) in equity accounts from capital
unit transactions ...................................... 32,004 26,801
--------- ---------
Net increase (decrease) in equity accounts .............. 56,777 40,020
Depositor's equity contribution (net redemption) ......... 0 0
EQUITY ACCOUNTS:
Beginning of period ...................................... 107,925 67,905
--------- ---------
End of period ............................................ $ 164,702 $ 107,925
========= =========
<CAPTION>
AGGRESSIVE GROWTH BALANCED
SUB-ACCOUNT SUB-ACCOUNT
DECEMBER 31 DECEMBER 31
--------------------- -----------------------
1997 1996 1997 1996
---------- ---------- ----------- -----------
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income (loss) ............................. $ 7,795 $ 1,139 $ 992 $ 154
Net gain (loss) on investments ........................... 6,524 2,797 226 341
-------- -------- -------- -------
Net increase (decrease) in equity accounts resulting
from operations ......................................... 14,319 3,936 1,218 495
-------- -------- -------- -------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed) ...................... 40,282 26,224 4,373 3,090
-------- -------- -------- -------
Less cost of units redeemed:
Administrative charges .................................. 9,888 6,413 958 575
Policy loans ............................................ 1,926 863 179 78
Surrender benefits ...................................... 2,485 1,350 153 85
Death benefits .......................................... 58 30 3 4
-------- -------- -------- -------
14,357 8,656 1,293 742
-------- -------- -------- -------
Increase (decrease) in equity accounts from capital
unit transactions ...................................... 25,925 17,568 3,080 2,348
-------- -------- -------- -------
Net increase (decrease) in equity accounts .............. 40,244 21,504 4,298 2,843
Depositor's equity contribution (net redemption) ......... 0 0 0 (220)
EQUITY ACCOUNTS:
Beginning of period ...................................... 54,408 32,904 6,418 3,795
-------- -------- -------- -------
End of period ............................................ $ 94,652 $ 54,408 $ 10,716 $ 6,418
======== ======== ======== =======
</TABLE>
<TABLE>
<CAPTION>
GROWTH & TACTICAL ASSET
INCOME ALLOCATION
SUB-ACCOUNT (B) SUB-ACCOUNT
DECEMBER 31 DECEMBER 31
---------------------- ----------------------
1997 1996 1997 1996
---------- ----------- ---------- -----------
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income (loss) ............................. $ 1,214 $ 246 $ 1,913 $ 584
Net gain (loss) on investments ........................... 283 210 1,362 1,179
------- ------- -------- --------
Net increase (decrease) in equity accounts resulting
from operations ......................................... 1,497 456 3,275 1,763
------- ------- -------- --------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed) ...................... 3,232 3,245 11,386 9,062
------- ------- -------- --------
Less cost of units redeemed:
Administrative charges .................................. 733 440 2,219 1,135
Policy loans ............................................ 163 73 463 306
Surrender benefits ...................................... 260 82 742 866
Death benefits .......................................... 11 3 60 18
------- ------- -------- --------
1,167 598 3,484 2,325
------- ------- -------- --------
Increase (decrease) in equity accounts from capital
unit transactions ...................................... 2,065 2,647 7,902 6,737
------- ------- -------- --------
Net increase (decrease) in equity accounts .............. 3,562 3,103 11,177 8,500
Depositor's equity contribution (net redemption) ......... 0 (233) 0 0
EQUITY ACCOUNTS:
Beginning of period ...................................... 5,501 2,631 17,946 9,446
------- ------- -------- --------
End of period ............................................ $ 9,063 $ 5,501 $ 29,123 $ 17,946
======= ======= ======== ========
<CAPTION>
C.A.S.E. GROWTH
SUB-ACCOUNT
DECEMBER 31
-----------------------
1997 1996
------------ ----------
<S> <C> <C>
OPERATIONS:
Net investment income (loss) ............................. $ 994 $ 70
Net gain (loss) on investments ........................... (252) 228
-------- -------
Net increase (decrease) in equity accounts resulting
from operations ......................................... 742 298
-------- -------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed) ...................... 8,029 4,302
-------- -------
Less cost of units redeemed:
Administrative charges .................................. 970 140
Policy loans ............................................ 146 7
Surrender benefits ...................................... 144 12
Death benefits .......................................... 6 0
-------- -------
1,266 159
-------- -------
Increase (decrease) in equity accounts from capital
unit transactions ...................................... 6,763 4,143
-------- -------
Net increase (decrease) in equity accounts .............. 7,505 4,441
Depositor's equity contribution (net redemption) ......... (25) 25
EQUITY ACCOUNTS:
Beginning of period ...................................... 4,466 0
-------- -------
End of period ............................................ $ 11,946 $ 4,466
======== =======
</TABLE>
The notes to the financial statements are an integral part of this report.
8
W R L S e r i e s L i f e A c c o u n t
<PAGE>
WRL SERIES LIFE ACCOUNT
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
For the year or period ended
All amounts in thousands
----------------------------------
<TABLE>
<CAPTION>
VALUE EQUITY
SUB-ACCOUNT
DECEMBER 31
------------------------
1997 1996 (C)
------------ ---------
<S> <C> <C>
OPERATIONS:
Net investment income (loss) ............................. $ 183 $ 19
Net gain (loss) on investments ........................... 3,038 603
-------- -------
Net increase (decrease) in equity accounts resulting
from operations ......................................... 3,221 622
-------- -------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed) ...................... 17,023 8,292
-------- -------
Less cost of units redeemed:
Administrative charges .................................. 1,257 153
Policy loans ............................................ 542 36
Surrender benefits ...................................... 388 38
Death benefits .......................................... 0 0
-------- -------
2,187 227
-------- -------
Increase (decrease) in equity accounts from capital
unit transactions ...................................... 14,836 8,065
-------- -------
Net increase (decrease) in equity accounts .............. 18,057 8,687
Depositor's equity contribution (net redemption) ......... (230) 200
EQUITY ACCOUNTS:
Beginning of period ...................................... 8,887 0
-------- -------
End of period ............................................ $ 26,714 $ 8,887
======== =======
</TABLE>
<TABLE>
<CAPTION>
INTERNATIONAL U.S.
EQUITY EQUITY
SUB-ACCOUNT SUB-ACCOUNT
DECEMBER 31 DECEMBER 31
1997 (D) 1997 (D)
---------------- ------------
<S> <C> <C>
OPERATIONS:
Net investment income (loss) ............................. $ (4) $ 107
Net gain (loss) on investments ........................... 31 96
------ -------
Net increase (decrease) in equity accounts resulting
from operations ......................................... 27 203
------ -------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed) ...................... 2,458 3,208
------ -------
Less cost of units redeemed:
Administrative charges .................................. 117 91
Policy loans ............................................ 59 56
Surrender benefits ...................................... 14 9
Death benefits .......................................... 0 0
------ -------
190 156
------ -------
Increase (decrease) in equity accounts from capital
unit transactions ...................................... 2,268 3,052
------ -------
Net increase (decrease) in equity accounts .............. 2,295 3,255
Depositor's equity contribution (net redemption) ......... (6) 3
EQUITY ACCOUNTS:
Beginning of period ...................................... 0 0
------ -------
End of period ............................................ $ 2,289 $ 3,258
======= =======
</TABLE>
(a) Prior to May 1, 1997, this sub-account was known as Equity-Income.
(b) Prior to May 1, 1997, this sub-account was known as Utility.
(c) The inception date of this sub-account was May 1, 1996.
(d) The inception date of this sub-account was January 2, 1997.
The notes to the financial statements are an integral part of this report.
1 9 9 7 A n n u a l R e p o r t
9
<PAGE>
WRL SERIES LIFE ACCOUNT
SELECTED PER UNIT DATA AND RATIOS*
For the period ended
----------------------------------
<TABLE>
<CAPTION>
MONEY MARKET SUB-ACCOUNT
DECEMBER 31
-------------------------
1997 1996
------------ ------------
<S> <C> <C>
Accumulation unit value, beginning of period ......................... $ 15.45 $ 14.83
Income from operations:
Net investment income (loss) ....................................... 0.68 0.62
Net realized and unrealized gain (loss) on investments ............. 0.00 0.00
------- -------
Total income (loss) from operations ............................... 0.68 0.62
------- -------
Accumulation unit value, end of period ............................... $ 16.13 $ 15.45
======= =======
Total return (a) ..................................................... 4.37% 4.17%
Ratios and supplemental data:
Net assets at end of period (in thousands) .......................... $ 16,440 $ 12,740
Ratios of net investment income (loss) to average net assets (b) .... 4.28% 4.07%
<CAPTION>
MONEY MARKET SUB-ACCOUNT
DECEMBER 31
------------------------------------
1995 1994 1993
------------ ----------- -----------
<S> <C> <C> <C>
Accumulation unit value, beginning of period ......................... $ 14.19 $ 13.84 $ 13.63
Income from operations:
Net investment income (loss) ....................................... 0.64 0.35 0.21
Net realized and unrealized gain (loss) on investments ............. 0.00 0.00 0.00
------- ------- -------
Total income (loss) from operations ............................... 0.64 0.35 0.21
------- ------- -------
Accumulation unit value, end of period ............................... $ 14.83 $ 14.19 $ 13.84
======= ======= =======
Total return (a) ..................................................... 4.49% 2.58% 1.52%
Ratios and supplemental data:
Net assets at end of period (in thousands) .......................... $ 10,759 $ 9,706 $ 4,985
Ratios of net investment income (loss) to average net assets (b) .... 4.37% 2.66% 1.51%
</TABLE>
<TABLE>
<CAPTION>
BOND SUB-ACCOUNT
DECEMBER 31
--------------------------
1997 1996
------------ -------------
<S> <C> <C>
Accumulation unit value, beginning of period ......................... $ 19.53 $ 19.67
Income from operations:
Net investment income (loss) ....................................... 1.01 0.99
Net realized and unrealized gain (loss) on investments ............. 0.58 ( 1.13)
------- -------
Total income (loss) from operations ............................... 1.59 ( 0.14)
------- -------
Accumulation unit value, end of period ............................... $ 21.12 $ 19.53
======= =======
Total return (a) ..................................................... 8.18% ( 0.75%)
Ratios and supplemental data:
Net assets at end of period (in thousands) .......................... $ 17,657 $ 11,585
Ratios of net investment income (loss) to average net assets (b) .... 5.06% 5.34%
<CAPTION>
BOND SUB-ACCOUNT
DECEMBER 31
-----------------------------------
1995 1994 1993
----------- ----------- -----------
<S> <C> <C> <C>
Accumulation unit value, beginning of period ......................... $ 16.14 $ 17.50 $ 15.57
Income from operations:
Net investment income (loss) ....................................... 1.05 0.89 2.11
Net realized and unrealized gain (loss) on investments ............. 2.48 ( 2.25) ( 0.18)
------- -------- --------
Total income (loss) from operations ............................... 3.53 ( 1.36) 1.93
------- -------- --------
Accumulation unit value, end of period ............................... $ 19.67 $ 16.14 $ 17.50
======= ======== ========
Total return (a) ..................................................... 21.89% ( 7.77%) 12.40%
Ratios and supplemental data:
Net assets at end of period (in thousands) .......................... $10,066 $ 6,259 $ 6,985
Ratios of net investment income (loss) to average net assets (b) .... 5.80% 5.57% 12.92%
</TABLE>
<TABLE>
<CAPTION>
GROWTH SUB-ACCOUNT
DECEMBER 31
---------------------------
1997 1996
------------- -------------
<S> <C> <C>
Accumulation unit value, beginning of period ......................... $ 48.48 $ 41.47
Income from operations:
Net investment income (loss) ....................................... 5.83 2.88
Net realized and unrealized gain (loss) on investments ............. 2.17 4.13
-------- --------
Total income (loss) from operations ............................... 8.00 7.01
-------- --------
Accumulation unit value, end of period ............................... $ 56.48 $ 48.48
======== ========
Total return (a) ..................................................... 16.50% 16.91%
Ratios and supplemental data:
Net assets at end of period (in thousands) .......................... $ 450,271 $ 349,491
Ratios of net investment income (loss) to average net assets (b) .... 10.84% 6.41%
<CAPTION>
GROWTH SUB-ACCOUNT
DECEMBER 31
------------------------------------------
1995 1994 1993
------------- -------------- -------------
<S> <C> <C> <C>
Accumulation unit value, beginning of period ......................... $ 28.44 $ 31.30 $ 30.37
Income from operations:
Net investment income (loss) ....................................... 3.89 0.04 0.46
Net realized and unrealized gain (loss) on investments ............. 9.14 ( 2.90) 0.47
-------- -------- --------
Total income (loss) from operations ............................... 13.03 ( 2.86) 0.93
-------- -------- --------
Accumulation unit value, end of period ............................... $ 41.47 $ 28.44 $ 31.30
======== ======== ========
Total return (a) ..................................................... 45.81% ( 9.13%) 3.06%
Ratios and supplemental data:
Net assets at end of period (in thousands) .......................... $ 262,467 $ 161,490 $ 169,757
Ratios of net investment income (loss) to average net assets (b) .... 11.05% 0.16% 1.56%
</TABLE>
The notes to the financial statements are an integral part of this report.
10
W R L S e r i e s L i f e A c c o u n t
<PAGE>
WRL SERIES LIFE ACCOUNT
SELECTED PER UNIT DATA AND RATIOS*
For the period ended
----------------------------------
<TABLE>
<CAPTION>
GLOBAL SUB-ACCOUNT
DECEMBER 31
--------------------------------------------------
1997 1996 1995 1994 (D)
------------- ----------- ----------- ------------
<S> <C> <C> <C> <C>
Accumulation unit value, beginning of period ......................... $ 15.13 $ 11.95 $ 9.80 $ 10.00
Income from operations:
Net investment income (loss) ....................................... 2.30 1.50 0.45 0.71
Net realized and unrealized gain (loss) on investments ............. 0.37 1.68 1.70 ( 0.91)
-------- ------- ------- -------
Total income (loss) from operations ............................... 2.67 3.18 2.15 ( 0.20)
-------- ------- ------- -------
Accumulation unit value, end of period ............................... $ 17.80 $ 15.13 $ 11.95 $ 9.80
======== ======= ======= =======
Total return (a) ..................................................... 17.69% 26.60% 21.96% ( 2.02%)
Ratios and supplemental data:
Net assets at end of period (in thousands) .......................... $ 145,017 $83,159 $37,049 $ 21,672
Ratios of net investment income (loss) to average net assets (b) .... 13.39% 11.09% 4.25% 8.86%
</TABLE>
<TABLE>
<CAPTION>
STRATEGIC TOTAL RETURN
SUB-ACCOUNT (H)
DECEMBER 31
-----------------------
1997 1996
----------- -----------
<S> <C> <C>
Accumulation unit value, beginning of period ......................... $ 15.66 $ 13.74
Income from operations:
Net investment income (loss) ....................................... 1.56 0.82
Net realized and unrealized gain (loss) on investments ............. 1.69 1.10
------- -------
Total income (loss) from operations ............................... 3.25 1.92
------- -------
Accumulation unit value, end of period ............................... $ 18.91 $ 15.66
======= =======
Total return (a) ..................................................... 20.77% 13.97%
Ratios and supplemental data:
Net assets at end of period (in thousands) .......................... $80,753 $55,900
Ratios of net investment income (loss) to average net assets (b) .... 8.89% 5.76%
<CAPTION>
STRATEGIC TOTAL RETURN SUB-ACCOUNT
SUB-ACCOUNT (H)
DECEMBER 31
-----------------------------------
1995 1994 1993 (C)
----------- ----------- -----------
<S> <C> <C> <C>
Accumulation unit value, beginning of period ......................... $ 11.12 $ 11.28 $ 10.00
Income from operations:
Net investment income (loss) ....................................... 0.68 0.18 0.19
Net realized and unrealized gain (loss) on investments ............. 1.94 ( 0.34) 1.09
------- ------- -------
Total income (loss) from operations ............................... 2.62 ( 0.16) 1.28
------- ------- -------
Accumulation unit value, end of period ............................... $ 13.74 $ 11.12 $ 11.28
======= ======= =======
Total return (a) ..................................................... 23.55% ( 1.42%) 12.81%
Ratios and supplemental data:
Net assets at end of period (in thousands) .......................... $39,648 $23,649 $13,343
Ratios of net investment income (loss) to average net assets (b) .... 5.47% 1.93% 2.27%
</TABLE>
<TABLE>
<CAPTION>
EMERGING GROWTH SUB-ACCOUNT
DECEMBER 31
---------------------------
1997 1996
------------- -------------
<S> <C> <C>
Accumulation unit value, beginning of period ......................... $ 19.51 $ 16.56
Income from operations:
Net investment income (loss) ....................................... 2.20 0.82
Net realized and unrealized gain (loss) on investments ............. 1.77 2.13
-------- --------
Total income (loss) from operations ............................... 3.97 2.95
-------- --------
Accumulation unit value, end of period ............................... $ 23.48 $ 19.51
======== ========
Total return (a) ..................................................... 20.37% 17.82%
Ratios and supplemental data:
Net assets at end of period (in thousands) .......................... $ 164,702 $ 107,925
Ratios of net investment income (loss) to average net assets (b) .... 10.18% 4.51%
<CAPTION>
EMERGING GROWTH SUB-ACCOUNT
DECEMBER 31
------------------------------------
1995 1994 1993 (C)
----------- ------------ -----------
<S> <C> <C> <C>
Accumulation unit value, beginning of period ......................... $ 11.38 $ 12.40 $ 10.00
Income from operations:
Net investment income (loss) ....................................... 0.65 ( 0.09) ( 0.09)
Net realized and unrealized gain (loss) on investments ............. 4.53 ( 0.93) 2.49
------- ------- -------
Total income (loss) from operations ............................... 5.18 ( 1.02) 2.40
------- ------- -------
Accumulation unit value, end of period ............................... $ 16.56 $ 11.38 $ 12.40
======= ======= =======
Total return (a) ..................................................... 45.49% ( 8.18%) 23.96%
Ratios and supplemental data:
Net assets at end of period (in thousands) .......................... $67,905 $36,687 $18,620
Ratios of net investment income (loss) to average net assets (b) .... 4.66% ( 0.86%) ( 0.92%)
</TABLE>
The notes to the financial statements are an integral part of this report.
1 9 9 7 A n n u a l R e p o r t
11
<PAGE>
WRL SERIES LIFE ACCOUNT
SELECTED PER UNIT DATA AND RATIOS*
For the period ended
----------------------------------
<TABLE>
<CAPTION>
AGGRESSIVE GROWTH SUB-ACCOUNT
DECEMBER 31
------------------------------------------------------
1997 1996 1995 1994 (D)
----------- ----------- ----------- ------------
<S> <C> <C> <C> <C>
Accumulation unit value, beginning of period ......................... $ 14.70 $ 13.43 $ 9.82 $ 10.00
Income from operations:
Net investment income (loss) ....................................... 1.75 0.36 0.37 ( 0.06)
Net realized and unrealized gain (loss) on investments ............. 1.65 0.91 3.24 ( 0.12)
------- ------- ------- -------
Total income (loss) from operations ............................... 3.40 1.27 3.61 ( 0.18)
------- ------- ------- -------
Accumulation unit value, end of period ............................... $ 18.10 $ 14.70 $ 13.43 $ 9.82
======= ======= ======= =======
Total return (a) ..................................................... 23.14% 9.46% 36.79% ( 1.85%)
Ratios and supplemental data:
Net assets at end of period (in thousands) .......................... $94,652 $54,408 $32,904 $ 8,909
Ratios of net investment income (loss) to average net assets (b) .... 10.26% 2.65% 2.93% ( 0.72%)
</TABLE>
<TABLE>
<CAPTION>
BALANCED SUB-ACCOUNT
DECEMBER 31
-----------------------------------------------------
1997 1996 1995 1994 (D)
----------- ----------- ---------- ------------
<S> <C> <C> <C> <C>
Accumulation unit value, beginning of period ......................... $ 12.21 $ 11.13 $ 9.37 $ 10.00
Income from operations:
Net investment income (loss) ....................................... 1.55 0.36 0.37 0.22
Net realized and unrealized gain (loss) on investments ............. 0.41 0.72 1.39 ( 0.85)
------- ------- ------- -------
Total income (loss) from operations ............................... 1.96 1.08 1.76 ( 0.63)
------- ------- ------- -------
Accumulation unit value, end of period ............................... $ 14.17 $ 12.21 $ 11.13 $ 9.37
======= ======= ======= =======
Total return (a) ..................................................... 16.06% 9.73% 18.73% ( 6.29%)
Ratios and supplemental data:
Net assets at end of period (in thousands) .......................... $10,716 $ 6,418 $ 3,795 $ 2,145
Ratios of net investment income (loss) to average net assets (b) .... 11.62% 3.18% 3.59% 3.06%
</TABLE>
<TABLE>
<CAPTION>
GROWTH & INCOME SUB-ACCOUNT (I)
DECEMBER 31
-----------------------------------------------------
1997 1996 1995 1994 (D)
----------- ----------- ---------- ------------
<S> <C> <C> <C> <C>
Accumulation unit value, beginning of period ......................... $ 13.03 $ 11.77 $ 9.49 $ 10.00
Income from operations:
Net investment income (loss) ....................................... 2.61 0.76 0.49 0.29
Net realized and unrealized gain (loss) on investments ............. 0.45 0.50 1.79 ( 0.80)
------- ------- ------- -------
Total income (loss) from operations ............................... 3.06 1.26 2.28 ( 0.51)
------- ------- ------- -------
Accumulation unit value, end of period ............................... $ 16.09 $ 13.03 $ 11.77 $ 9.49
======= ======= ======= =======
Total return (a) ..................................................... 23.54% 10.64% 24.14% ( 5.15%)
Ratios and supplemental data:
Net assets at end of period (in thousands) .......................... $ 9,063 $ 5,501 $ 2,631 $ 1,215
Ratios of net investment income (loss) to average net assets (b) .... 18.50% 6.38% 4.57% 3.71%
</TABLE>
The notes to the financial statements are an integral part of this report.
12
W R L S e r i e s L i f e A c c o u n t
<PAGE>
WRL SERIES LIFE ACCOUNT
SELECTED PER UNIT DATA AND RATIOS*
For the period ended
----------------------------------
<TABLE>
<CAPTION>
TACTICAL ASSET ALLOCATION SUB-ACCOUNT
DECEMBER 31
--------------------------------------
1997 1996 1995 (E)
----------- ----------- ----------
<S> <C> <C> <C>
Accumulation unit value, beginning of period ......................... $ 13.50 $ 11.90 $ 10.00
Income from operations:
Net investment income (loss) ....................................... 1.20 0.53 0.61
Net realized and unrealized gain (loss) on investments ............. 0.90 1.07 1.29
------- ------- -------
Total income (loss) from operations ............................... 2.10 1.60 1.90
------- ------- -------
Accumulation unit value, end of period ............................... $ 15.60 $ 13.50 $ 11.90
======= ======= =======
Total return (a) ..................................................... 15.55% 13.40% 19.03%
Ratios and supplemental data:
Net assets at end of period (in thousands) .......................... $29,123 $17,946 $ 9,446
Ratios of net investment income (loss) to average net assets (b) .... 8.14% 4.35% 5.47%
</TABLE>
<TABLE>
<CAPTION>
C.A.S.E. GROWTH
SUB-ACCOUNT
DECEMBER 31
------------------------
1997 1996 (F)
----------- ----------
<S> <C> <C>
Accumulation unit value, beginning of period ......................... $ 10.81 $ 10.00
Income from operations:
Net investment income (loss) ....................................... 1.51 0.37
Net realized and unrealized gain (loss) on investments ............. 0.00 0.44
------- -------
Total income (loss) from operations ............................... 1.51 0.81
------- -------
Accumulation unit value, end of period ............................... $ 12.32 $ 10.81
======= =======
Total return (a) ..................................................... 14.00% 8.09%
Ratios and supplemental data:
Net assets at end of period (in thousands) .......................... $11,946 $ 4,466
Ratios of net investment income (loss) to average net assets (b) .... 12.65% 6.11%
</TABLE>
<TABLE>
<CAPTION>
VALUE EQUITY
SUB-ACCOUNT
DECEMBER 31
------------------------
1997 1996 (F)
----------- ----------
<S> <C> <C>
Accumulation unit value, beginning of period ......................... $ 11.25 $ 10.00
Income from operations:
Net investment income (loss) ....................................... 0.14 0.05
Net realized and unrealized gain (loss) on investments ............. 2.55 1.20
------- -------
Total income (loss) from operations ............................... 2.69 1.25
------- -------
Accumulation unit value, end of period ............................... $ 13.94 $ 11.25
======= =======
Total return (a) ..................................................... 23.93% 12.51%
Ratios and supplemental data:
Net assets at end of period (in thousands) .......................... $26,714 $ 8,887
Ratios of net investment income (loss) to average net assets (b) .... 1.05% 0.77%
</TABLE>
The notes to the financial statements are an integral part of this report.
1 9 9 7 A n n u a l R e p o r t
13
<PAGE>
WRL SERIES LIFE ACCOUNT
SELECTED PER UNIT DATA AND RATIOS*
For the period ended
----------------------------------
<TABLE>
<CAPTION>
INTERNATIONAL U.S.
EQUITY EQUITY
SUB-ACCOUNT SUB-ACCOUNT
DECEMBER 31 DECEMBER 31
1997 (G) 1997 (G)
----------------- ------------
<S> <C> <C>
Accumulation unit value, beginning of period ......................... $ 10.00 $ 10.00
Income from operations:
Net investment income (loss) ....................................... ( 0.03) 0.99
Net realized and unrealized gain (loss) on investments ............. 0.68 1.60
------- -------
Total income (loss) from operations ............................... 0.65 2.59
------- -------
Accumulation unit value, end of period ............................... $ 10.65 $ 12.59
======= =======
Total return (a) ..................................................... 6.54% 25.89%
Ratios and supplemental data:
Net assets at end of period (in thousands) .......................... $ 2,289 $ 3,258
Ratios of net investment income (loss) to average net assets (b) .... ( 0.28%) 8.28%
</TABLE>
* The above tables illustrate the change for a unit outstanding computed using
average units outstanding throughout each period.
See Notes to Selected Per Unit Data and Ratios below.
NOTES TO SELECTED PER UNIT DATA AND RATIOS:
(a) For periods less than one year, the total return is not annualized.
(b) For periods less than one year, the ratio of net investment income to
average net assets is annualized.
(c) The inception date of this sub-account was March 1, 1993.
(d) The inception date of this sub-account was March 1, 1994.
(e) The inception date of this sub-account was January 3, 1995.
(f) The inception date of this sub-account was May 1, 1996.
(g) The inception date of this sub-account was January 2, 1997.
(h) Prior to May 1, 1997, this sub-account was known as Equity-Income.
(i) Prior to May 1, 1997, this sub-account was known as Utility.
The notes to the financial statements are an integral part of this report.
14
W R L S e r i e s L i f e A c c o u n t
<PAGE>
WRL SERIES LIFE ACCOUNT
NOTES TO FINANCIAL STATEMENTS
December 31, 1997
--------------------------------------------------------
NOTE 1 -- ORGANIZATION AND SUMMARY OF
SIGNIFICANT ACCOUNTING
POLICIES
The WRL Series Life Account (the "Life Account"), was established as a
variable life insurance separate account of Western Reserve Life Assurance Co.
of Ohio ("WRL") and is registered as a unit investment trust ("Trust") under
the Investment Company Act of 1940, as amended. The Life Account contains
fourteen investment options referred to as sub-accounts. Each sub-account
invests in the corresponding Portfolio of the WRL Series Fund, Inc.
(collectively referred to as the "Fund" and individually as a "Portfolio"), a
registered management investment company under the Investment Company Act of
1940, as amended.
The Fund has entered into annually renewable investment advisory agreements
for each Portfolio with WRL Investment Management, Inc. ("WRL Management") as
investment adviser. Costs incurred in connection with the advisory services
rendered by WRL Management are paid by each Portfolio. WRL Management has
entered into sub-advisory agreements with various management companies, some of
which are affiliates of WRL. Each sub-adviser is compensated directly by WRL
Management.
Effective May 1, 1997, the names of the Equity-Income and Utility
Sub-Accounts were changed to the Strategic Total Return and Growth & Income
Sub-Accounts, respectively.
On December 16, 1997, pursuant to an exemptive order (Rel. No. IC-22944)
received from the Securities and Exchange Commission for the substitution of
securities issued by the WRL Series Fund and held by the Life Series Account to
support individual premium variable life insurance policies, investments were
transferred from the Short-to-Intermediate Government Sub-Account to the Bond
Sub-Account.
On January 2, 1997, WRL made an initial contribution of $ 600,000 to the
Life Account. The amount of the contribution and units received were as
follows:
<TABLE>
<CAPTION>
SUB-ACCOUNT CONTRIBUTION UNITS
- ----------------------- -------------- ------------------
<S> <C> <C>
International Equity $ 400,000 40,000.000000
U.S. Equity $ 200,000 20,000.000000
</TABLE>
On April 28, 1997, WRL redeemed the initial contribution in the
International Equity Sub-Account for $ 406,299 and the U.S. Equity sub-account
for $ 197,490.
The Life Account holds assets to support the benefits under certain flexible
premium variable universal life insurance policies (the "Policies") issued by
WRL. The Life Account's equity transactions are accounted for using the
appropriate effective date at the corresponding accumulation unit value.
The following significant accounting policies, which are in conformity with
generally accepted accounting principles for unit investment trusts, have been
consistently applied in the preparation of the Trust's financial statements.
A. VALUATION OF INVESTMENTS AND SECURITIES TRANSACTIONS
Investments in the Fund's shares are stated at the closing net asset value
("NAV") per share as determined by the Fund. Investment transactions are
accounted for on the trade date at the Fund NAV next determined after receipt
of sale or redemption orders without sales charges. Dividend income and capital
gains distributions are recorded on the ex-dividend date. The cost of
investments sold is determined on a first-in, first-out basis.
B. FEDERAL INCOME TAXES
The operations of the Life Account are a part of and are taxed with the
total operations of WRL, which is taxed as a life insurance company under the
Internal Revenue Code. Under current law the investment income of the Life
Account, including realized and unrealized capital gains, is not taxable to
WRL. Accordingly, no provision for Federal income taxes has been made.
C. ESTIMATES
The preparation of financial statements in accordance with generally
accepted accounting principles requires management to make estimates and
assumptions that effect the reported amounts and disclosures in the financial
statements. Actual results could differ from those estimates.
NOTE 2 -- CHARGES AND DEDUCTIONS
Charges are assessed by WRL in connection with the issuance and
administration of the Policies.
A. POLICY CHARGES
Under some forms of the Policies, a sales charge and premium taxes are
deducted by WRL prior to allocation of policyowner payments to the
sub-accounts. Thereafter, monthly ad-
1 9 9 7 A n n u a l R e p o r t
15
<PAGE>
WRL SERIES LIFE ACCOUNT
NOTES TO FINANCIAL STATEMENTS
December 31, 1997
(continued)
----------------------------------
NOTE 2 -- (CONTINUED)
ministrative and cost of insurance charges are deducted from the sub-accounts.
Contingent surrender charges also apply.
Under the other forms of the Policies, such "front-end" and other
administrative charges are deducted prior to allocation of the initial premium
payment but may reside as contingent surrender charges.
Under all forms of the Policy, monthly charges against policy cash values are
made to compensate WRL for costs of insurance provided.
B. LIFE ACCOUNT CHARGES
A daily charge equal to an annual rate of 0.90% of average daily net assets
is assessed to compensate WRL for assumption of mortality and expense risks and
administrative services in connection with issuance and administration of the
Policies. This charge (not assessed at the individual contract level)
effectively reduces the value of a unit outstanding during the year.
NOTE 3 -- DIVIDENDS AND DISTRIBUTIONS
Dividends of the Money Market Portfolio are declared daily and reinvested
monthly. Dividends of the remaining Portfolios are typically declared and
reinvested semi-annually, while capital gains distributions are declared and
reinvested annually. Dividends and distributions of the Fund are recorded on
the ex-date and generally are paid to and reinvested by the Life Account on the
next business day after the ex-date. Dividends are not declared by the Life
Account, since the increase in the value of the underlying investment in the
Fund is reflected daily in the unit price used to calculate the equity value
within the Life Account. Consequently, a dividend distribution by the
underlying Fund does not change either the unit price or equity values within
the Life Account.
NOTE 4 -- SECURITIES TRANSACTIONS
Securities transactions are summarized as follows:
For the year or period ended December 31, 1997 (in thousands)
<TABLE>
<CAPTION>
MONEY MARKET BOND GROWTH
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT
<S> <C> <C> <C>
Purchase of long-term securities .................... $ 31,536 $ 7,334 $ 95,096
Proceeds from sales of long-term securities ......... 27,586 1,711 9,617
STRATEGIC TOTAL EMERGING
GLOBAL RETURN GROWTH
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT
Purchase of long-term securities .................... $ 63,481 $ 20,134 $ 51,532
Proceeds from sales of long-term securities ......... 2,595 1,789 5,791
AGGRESSIVE GROWTH &
GROWTH BALANCED INCOME
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT
Purchase of long-term securities .................... $ 36,390 $ 4,654 $ 3,925
Proceeds from sales of long-term securities ......... 2,757 571 683
TACTICAL ASSET C.A.S.E. VALUE
ALLOCATION GROWTH EQUITY
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT
Purchase of long-term securities .................... $ 11,192 $ 8,860 $ 16,770
Proceeds from sales of long-term securities ......... 1,496 1,124 2,030
INTERNATIONAL U.S.
EQUITY EQUITY
SUB-ACCOUNT (A) SUB-ACCOUNT (A)
Purchase of long-term securities .................... $ 4,574 $ 4,082
Proceeds from sales of long-term securities ......... 2,322 931
</TABLE>
(a) The inception date of this sub-account was January 2, 1997.
16
W R L S e r i e s L i f e A c c o u n t
<PAGE>
WRL SERIES LIFE ACCOUNT
NOTES TO FINANCIAL STATEMENTS
December 31, 1997
(continued)
----------------------------------
NOTE 5 -- EQUITY TRANSACTIONS
For the year or period ended December 31, 1997
<TABLE>
<CAPTION>
MONEY MARKET BOND GROWTH
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT
<S> <C> <C> <C>
Units balance - beginning of year ........... 824,579.964824 593,289.952352 7,208,481.980640
Units issued ................................ 9,508,542.992920 567,591.792111 2,877,261.682232
Units redeemed .............................. 9,313,607.867949 325,011.550833 2,113,732.157906
---------------- ---------------- ----------------
Units balance - end of year ................. 1,019,515.089795 835,870.193630 7,972,011.504966
================ ================ ================
STRATEGIC TOTAL EMERGING
GLOBAL RETURN GROWTH
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT
Units balance - beginning of year ........... 5,497,026.869725 3,569,906.038362 5,531,857.748031
Units issued ................................ 5,204,689.424549 1,808,954.429690 4,085,290.537514
Units redeemed .............................. 2,556,813.294554 1,108,535.542298 2,603,771.462693
---------------- ---------------- ----------------
Units balance - end of year ................. 8,144,902.999720 4,270,324.925754 7,013,376.822852
================ ================ ================
AGGRESSIVE GROWTH &
GROWTH BALANCED INCOME
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT
Units balance - beginning of year ........... 3,702,244.184822 525,703.773282 422,239.257570
Units issued ................................ 3,540,013.078309 471,558.712099 351,937.078911
Units redeemed .............................. 2,011,986.165118 240,908.819634 211,046.686884
---------------- ---------------- ----------------
Units balance - end of year ................. 5,230,271.098013 756,353.665747 563,129.649597
================ ================ ================
TACTICAL ASSET C.A.S.E. VALUE
ALLOCATION GROWTH EQUITY
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT
Units balance - beginning of year ........... 1,329,562.261984 413,189.701539 789,884.882222
Units issued ................................ 1,163,050.985561 930,816.590801 1,771,718.827803
Units redeemed .............................. 625,352.214528 374,627.211274 645,715.985962
---------------- ---------------- ----------------
Units balance - end of year ................. 1,867,261.033017 969,379.081066 1,915,887.724063
================ ================ ================
INTERNATIONAL U.S.
EQUITY EQUITY
SUB-ACCOUNT (A) SUB-ACCOUNT (A)
Units balance - beginning of period ......... N/A N/A
Units issued ................................ 484,482.761817 392,911.124759
Units redeemed .............................. 269,593.719591 134,098.291700
---------------- ----------------
Units balance - end of period ............... 214,889.042226 258,812.833059
================ ================
</TABLE>
(a) The inception date of this sub-account was January 2, 1997.
1 9 9 7 A n n u a l R e p o r t
17
<PAGE>
WRL SERIES LIFE ACCOUNT
NOTES TO FINANCIAL STATEMENTS
December 31, 1997
(continued)
----------------------------------
NOTE 6 -- OTHER MATTERS
At December 31, 1997, the equity accounts included net unrealized
appreciation (depreciation) on investments as follows (in thousands):
<TABLE>
<CAPTION>
SUB-ACCOUNT
- ----------------------------------
<S> <C>
Money Market ................... $ N/A
Bond ........................... 331
Growth ......................... 90,809
Global ......................... 8,984
Strategic Total Return ......... 13,770
Emerging Growth ................ 31,177
Aggressive Growth .............. 9,032
Balanced ....................... 677
Growth & Income ................ 482
Tactical Asset Allocation ...... 2,489
C.A.S.E. Growth ................ (235)
Value Equity ................... 3,178
International Equity ........... (103)
U.S. Equity .................... 15
</TABLE>
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W R L S e r i e s L i f e A c c o u n t
<PAGE>
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19
1 9 9 7 A n n u a l R e p o r t
<PAGE>
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20
W R L S e r i e s L i f e A c c o u n t
<PAGE>
/diamond/
WRL SERIES LIFE ACCOUNT
OFFICE OF THE WRL SERIES LIFE ACCOUNT
201 Highland Avenue
Largo, FL 33770-2597
1-800-851-9777
DISTRIBUTOR:
InterSecurities, Inc.
201 Highland Avenue
Largo, FL 33770-2597
INSURER:
Western Reserve Life Assurance Co. of Ohio
201 Highland Avenue
Largo, FL 33770-2597
INDEPENDENT ACCOUNTANTS:
Price Waterhouse LLP
1055 Broadway
Kansas City, MO 64105
<PAGE>
THIS MATERIAL IS FOR POLICY HOLDER'S
REPORTING PURPOSES ONLY AND SHALL NOT
BE USED IN CONNECTION WITH A SOLICITATION,
OFFER OR ANY PROPOSED SALE OR PURCHASE
OF SECURITIES. THIS MATERIAL MUST BE
PRECEDED OR ACCOMPANIED BY A PROSPECTUS.
[LOGO]
--------------------------------------------------
Western Reserve Life Assurance Co. of Ohio
Distributor: InterSecurities, Inc.
201 Highland Avenue /bullet/ Largo, Florida 33770-2597
February 1998
ACC00003 (2/98)
